80% of firms say Covid has spurred innovation
Eight in 10 (80%) firms believe the coronavirus pandemic has spurred innovation as businesses turn to new tools to enable remote working, according to a survey. In the third snap poll conducted by SM and CIPS, two-thirds (65.8%) of respondents said remote working forced by the outbreak had led to the increased adoption of digital procurement tools.
Procurement professionals noted remote working had had a positive impact by improving communication. Three-fifths (61.3%) said remote working had improved communication with their team, while almost half (49%) said they had increased communication with suppliers to manage the impact of the virus. However, nearly a quarter (23%) added that remote working had increased the risk of cybersecurity issues and for almost a fifth (18%) team communications had got worse.
Planning for a safe return to offices in the future is having an impact on spend. Nine in 10 (91%) said there had been increased spending on personal protective equipment and 84% were spending more on additional services such as cleaning and facilities management. Half (51%) said it would quite difficult to adhere to social distancing rules and half (52%) were paying, or expected to pay, up to 20% more for goods and services. A tenth (11%) were paying up to 50% more.
Respondents were divided on how long it will take for their supply chains to return to pre-Covid levels of activity. Almost a quarter (23%), believed it would take up to three months, 28% believed it would take up to six months and a further 28% believed it would take a year. Two-fifths (38%) said the impact of coronavirus was getting worse, slightly more than the 36% who said it was getting better.
Key actions being taken by firms to help rebuild supply chains included seeking alternative suppliers (62%), building inventory (42%), altering payment terms (41%) and reshoring supply chains (31%).
Over three-quarters (77%) said supplier vulnerability and risk exposure was a key area they were likely to monitor going forward, followed by global disruptions that could influence supply chains (74%) and spend analysis to deliver cost efficiencies (53%). Most (68%) firms had no plans to dial back on sustainability initiatives, but 15% said initiatives were no longer feasible, citing cost as the main reason.
Source: Supply Management